Asian investors tempted by Irish commercial property
May 06, 2015 - Ireland
The Irish real estate industry looks set to welcome an increased number of foreign direct investments in 2015, especially in the commercial sector.
As the country’s office segment continuous its upward trajectory, more offshore investors from Asia could enter the local property market, a top executive of CBRE Ireland recently told the Irish Times.
“With the pricing of prime assets moving from opportunistic pricing to core prices this year and the ongoing ‘internationalisation’ of the investor base in Ireland, I would also like to see some further new entrants to the market,” commented Johnny Horgan, head of capital markets.
He added: “There is a real possibility that we could attract longer term European and Asian investment to Ireland particularly if large portfolios are offered for sale,” especially now that the Irish market has “evolved from a debt-funded model to an equity-based model over the last number of years.”
Aside from the office segment, the industrial property sector could become a longer investment opportunity for foreign investors, particularly institutional players from Europe and the United Kingdom.
Horgan also noted that over the next few months, strong rental growth should be anticipated as dictated by the changing balance between supply and demand in the domestic market.
“The pace of appreciation will differ between sectors and sub-sectors, with the strongest potential for growth in the industrial and retail sectors,” he noted.
“Further upward pressure on office rental values is anticipated in 2015. We believe that prime office rents in Dublin have the capacity to increase by another 17 percent in 2015.”
Dublin, Ireland’s largest city, of late has shown a lot of promise and is increasingly showing up on investors’ radar, and was even named by Knight Frank as the world’s fastest-growing office rental market today due to its strong technology industry, which in turn fuels the growth of the real estate sector.
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